New Public Management

New Public Management

 A label used to define the general trend towards changing the style of
governance and administration in the public sector and to describe a number
of reforms that were carried out in several countries during 1980s and 1990s.
 A vision, an ideology or a bundle of particular management approaches and
techniques
 UK - important role in developing the concept of New Public Management
(NPM) and can claim to have been its ‘ birth place’
Public Management

 Management of public organizations is referred to as Public Management.

 successful management of departments and agencies
 New Public Management is an evolution of public administration which
applies managerial techniques to increase the efficiency and effectiveness
of public services.
New Public Management

Also known as
 Entrepreneurial Government,
 Managerialism,
 Market-based Public Administration
 or Reinventing Government
 Evolved during 1990s
Meaning of New Public Management

 Called
 Managerialism ( Pollitt)
 Entrepreneurial government ( by Osbone and Gaebler)
 Market Based New Public Administration ( by Lan and Rosenbloom)
 Third way between Pulbic Administration and Private Administration(U.A.Gunn)
Meaning of New Public
Management(NPM)
 Brought together – Public Administration and Business Management
 NPM – Third way between Business Management and Public Administration
 Public Management takes what and why from Public Administration and how
from Business Management.
 New strategy of administrative reform winning growing acceptance in the
world.
 NPM – Word coined by Christopher Hood in 1991 – Refers “ to the wholesale
induction of the core values of business administration into public sector.”
 NPM – According to Rita Mac – “ Seeks to offer goods and services and for
raising governmental performance levels.”
Evolution of NPM

 Disillusionment about the role of public bureaucracy as a sure solution t o

societal problems
 NPM – emerged out of the Thatcherism – privatisation of public enterprises
and Reaganism of 1980s.
 Aims – 3Es – Economy, Efficiency and Effectiveness
 More Result orientated, accountability on the basis of results
Reasons for the Evolution of NPM

 Globalization, international competitiveness and technological change

 Increase in Government expenditure
 Influence of Neo-Liberalism
 Impact of New Right philosophy
 Public Choice Approach
Eight driving Paradigms

 Devolving authority, providing flexibility

 Ensuring performance control and accountability
 Developing competition and choice
 Providing responsive service
 Improving the management of human resources
 Optimizing information technology
 Improving the quality of regulation
 Strengthening steering functions of the centre
NPM - Characteristics

 Adoption of managerial practices of private administration in public

administration
 Promotion of competition within public sector
 Greater use of contract arrangements within the government as well as
outside it
 Emphasis on results rather than procedure
 Formulation of explicit standards and measures of performance
 Emphasis on disaggregation of administrative units
 A shift away from policy to management
 Encouragement to parsimony in public expenditure
Objectives of NPM

 Result oriented
 Driving mottos are 3 E’s – Economy, Efficiency and Effectiveness
 Downsizing the bureaucracy and reduction in the functions of the modern
state – Privatisation
Attributes of NPM

 Localisation – physical proximity of the actual users of services

 Externalisation – contracting out of Governmental functions to non governmental agencies
 De-bureaucratisation – more autonomous units – roll back of state
New Public Management

 Lays emphasis on action points of public administration and recognizes the

primacy of the delivery system
 Recognises market as the model of government
 More into managerialism and customer orientation
 Views public administration from the managerial angle and applies
management solutions to problems, concerns and issues of public
administration